Background

Prolintas Infra Business Trust (Prolintas Infra BT) is the first listed business trust in Malaysia that is Shariah-compliant and has four income-generating highway assets under its portfolio.

Offering Scheme

The listing of Prolintas Infra BT entails the offering of up to 468.7mn units, comprising a retail offering of up to 45.75mn units and an institutional offering of up to 422.95mn units. The units offered to retail investors will be priced at RM0.95 per unit, whereas the units offered to institutional investors will be determined through bookbuilding. As Prolintas Infra BT will not be issuing any new units under the offering, the trust will not receive any proceeds from the IPO.

Main Competitive Advantages

1. Long-term concessions ensure consistent revenue streams;

2. Highways are in high-traffic areas;

3. High entry barriers;

4. Solid and identifiable revenue growth plan.

Earnings Forecasts

Prolintas Infra BT has provided its net profit forecast for FY24, with net profit and distributable income amounted to RM8.3mn and RM68.7mn respectively. For FY25 and FY26, we forecast distributable income to increase by 2.1% and 3.7%, respectively, underpinned by traffic volume growth of 3.3% and 3.5% in the corresponding years.

Valuation

We value Prolintas Infra BT at RM1.06/unit, based on FY25 target yield of 6.0%. Not Rated.

Source: TA Research - 11 Mar 2024